(This article is from STEP, and we put it here only for our internal members to study and research. If it violates the author’s copyright, please send e-mail to general@chinawealthplanning.com, and we will delete it immediately.)

A former Indian government minister is petitioning India's Supreme Court to recover so-called "black money" - untaxed funds concealed by wealthy individuals - from European banks.

The case is being brought by ex-law minister Ram Jethmalani, who is demanding that the government hand over relevant correspondence with the German authorities, with the Swiss bank UBS, and with the Liechtenstein bank LGT.

But the Indian federal government itself is refusing to cooperate, and is withholding the suspects' names on grounds of privilege. It has filed a court affidavit declining to divulge details of funds alleged by Jethmalani to have been deposited at LGT by 26 Indian individuals (though his petition is not limited to that bank - it covers all money concealed in foreign accounts).

The Supreme Court bench has sharply admonished the government for its refusal to reveal the names. It described the unlawful movement of funds offshore as "looting of national money".

India's Prime Minister, Manmohan Singh, replied that there is no instant solution to the problem, and that his government is bound to secrecy by its treaty obligations with the German government. His Solicitor-General told the court that the Indian tax authority is already taking recovery action under the Double Taxation Avoidance Act.

But Jethmalani's counsel accused the government of "indulging in a cover-up operation".

• A Swiss parliamentary committee approved the tax information exchange agreement negotiated between India and Switzerland. The treaty now goes to the full Swiss parliament for approval.

The opinions expressed do not constitute investment advice and specialist advice should be sought about your specific circumstances.